Tricky   10 #121 Posted April 22, 2008 ...  What happened to your friend is that she tried to guess the top of the market and got it wrong. Guessing the top of the market in a bubble is a mugs game but committing yourself to paying vast sums on a depreciating asset is too.  Just because she made a mistake in the past, doesn't mean the same decision can't be the right one at a different point in the future. Share this post Link to post Share on other sites Share this content via...
sham71   10 #122 Posted April 22, 2008 I wouldn't believe it until you see it. As I mentioned a week or so ago I suspect that you'll see new ways of affording them first.  Interestingly if you have kept your ear to the news over the last couple of days there seems to be wheels turning. It will be interesting to see what develops.  http://www.bbc.co.uk/blogs/thereporters/robertpeston/2008/04/why_mortgage_rates_wont_fall.html  well, the first plan isn't going to work. how much money will this government throw at this before they realise the market will out in the end? Share this post Link to post Share on other sites Share this content via...
sham71   10 #123 Posted April 26, 2008 http://business.timesonline.co.uk/tol/business/economics/article3819131.ece  and the plan may be ruled illegal - p**s up and brewery springs to mind. Share this post Link to post Share on other sites Share this content via...
perplexed   10 #124 Posted April 26, 2008 Your figures are good until the last bit. If the house dropped to 130,000 now, she's paid out £24,000 in rent, but (I'd estimate) saved more than that in interest payments for the first four years of a £150,000 mortgage. She's not £4,000 down, but she is 4 years behind. But the 20k drop more than makes up for 4 years on a 25 year term.  But you must admit, for you to use the extreme figure of £130,000 is not a great assumption to make. That would assume a drop of £70,000 on the price of a brief while ago, and a fall of £20,000 below the original £150,000 of 4 or 5 years ago. I've yet to hear of anyone taking that kind of hit yet...  Share this post Link to post Share on other sites Share this content via...
Phylis   10 #125 Posted April 28, 2008 But you must admit, for you to use the extreme figure of £130,000 is not a great assumption to make. That would assume a drop of £70,000 on the price of a brief while ago, and a fall of £20,000 below the original £150,000 of 4 or 5 years ago. I've yet to hear of anyone taking that kind of hit yet...  You will wait a long time to hear of drops like that because they wont happen. They never have happened and never will. Share this post Link to post Share on other sites Share this content via...
Tricky   10 #126 Posted April 28, 2008 According to Nationwide, the average house price for Yorkshire & Humberside in Q3 1989 was £65k. In Q1 1996, 6.5 years later the average price was £46.5k a fall of 28%.  This isn't too far off a fall of 35% for an individual property described by Cyclone above. Saying that such falls will never happen to any property is extremely glib under the current circumstances. Share this post Link to post Share on other sites Share this content via...
Tricky   10 #127 Posted April 28, 2008 P.S. the Nationwide Price/income ratio for FTBs was 4.0 in Q3 1989. By Q1 1996 it had fallen to 2.3. It stood at 4.6 last summer. Share this post Link to post Share on other sites Share this content via...
Phylis   10 #128 Posted April 28, 2008 According to Nationwide, the average house price for Yorkshire & Humberside in Q3 1989 was £65k. In Q1 1996, 6.5 years later the average price was £46.5k a fall of 28%.  This isn't too far off a fall of 35% for an individual property described by Cyclone above. Saying that such falls will never happen to any property is extremely glib under the current circumstances.  Such falls wont happen because of the shortage of housing stock. House building hasnt kept pace with the growing population. We all have to live somewhere. Share this post Link to post Share on other sites Share this content via...
Tricky   10 #129 Posted April 28, 2008 If people can't afford them, they can't buy them whatever the supply/demand is.  In fact the recent increases in demand for housing can be almost entirely explained by the increase in single owner-occupiers. If people stop at home until they get engaged and then find somewhere together, or they rent somewhere with friends instead of living on their own, your demand goes straight out of the window. Share this post Link to post Share on other sites Share this content via...
Phylis   10 #130 Posted April 28, 2008 If people can't afford them, they can't buy them whatever the supply/demand is.  In fact the recent increases in demand for housing can be almost entirely explained by the increase in single owner-occupiers. If people stop at home until they get engaged and then find somewhere together, or they rent somewhere with friends instead of living on their own, your demand goes straight out of the window.  But who wants to stay at home? They have been saying since the 60's that house prices are unaffordable. When houses were £300 they were unaffordable. We just have to face it that house prices have risen and people find new ways of affording a home. Share this post Link to post Share on other sites Share this content via...
MrDJ2008! Â Â 10 #131 Posted April 28, 2008 market is bad at the mo Share this post Link to post Share on other sites Share this content via...
Tricky   10 #132 Posted April 28, 2008 But who wants to stay at home?  Who wants to be able to fly and who wants to have x-ray vision?  They have been saying since the 60's that house prices are unaffordable. When houses were £300 they were unaffordable. We just have to face it that house prices have risen and people find new ways of affording a home.  Market behaviour. When prices are high, everyone complains that they can't afford it. Then they crash and everyone gets risk averse about property. Then it gets undervalued and everyone piles in and people who don't know the history of the market say things like, "house prices never go down". Then housing gets overvalued and everyone complains that they can't afford it... Share this post Link to post Share on other sites Share this content via...